Faced with meeting performance targets, Canada’s railways are now flooding the West Coast and Thunder Bay terminals with grain, the Western Grain Elevators Association says.
Western grain elevator companies can handle the 11,000 cars a week the federal government has ordered the railways to move, but some of those cars need to go to the United States and eastern Canada, executive director Wade Sobkowich said.
“We feel we can load and unload these cars in order to comply with the order, but it’s subject to rail cars coming at a consistent rate, apportioned appropriately among the corridors.” he said.
However, he said the railways appear to be pushing all the deliveries to the West Coast and Thunder Bay ports so that the ensuing congestion draws attention away from railway performance.
“We can see it happening already,” said Sobkowich in an interview March 25. “They are going to jam us with cars and then try to make the point the industry can’t handle them anyway.”
In a March 24 news release CN president and chief executive officer Claude Mongeau said he was concerned West Coast terminals “could soon hit capacity…”
“As I have said before, blaming railways alone — or even worse, threatening to punish them with re-regulation for an outsized crop and winter conditions beyond their control — will not help to move any more grain, now or over the longer term” Mongeau said.
“We need to encourage supply chain collaboration and promote sound commercial solutions to address the challenge of moving so much grain.”
As of March 25 the railways were 70,000 cars behind and there were 39 vessels waiting for grain at the West Coast — 28 in Vancouver and 11 at Prince Rupert.
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“It’s important to realize the railways are so far behind in filling orders that many of the cars they are providing are out of sync with the vessels that are waiting for product to arrive,” Sobkowich said. “We have to recognize the practical reality we are inheriting from the railways’ performance to date.”
The WGEA needs to decide what it wants, CN spokesman Mark Hallman said in an e-mail March 25. Last fall it asked the railways to double weekly car spotting to 20,000, he wrote. Now that it’s approaching 11,000 cars the WGEA says its members can’t handle that.
“CN flatly denies it’s flooding any terminal with grain,” Hallman wrote “It’s moving grain in corridors where capacity exists.”
While a big crop means quick rail movement is more important than ever, the size of the crop has no bearing on poor railway performance, Sobkowich said, adding that the railways have shipped less grain than last year.
CP Rail did not respond to requests for comment.
Sources say federal legislation aimed at addressing grain shippers complaints will be tabled in the House of Commons March 26.
The WGEA hopes the new law will allow shippers to define railway service and include provisions for fines when they fail to provide it. It also hopes the legislation will make interswitching more practical, encouraging more competition between railways.